November 12, 2014
Practice Groups:
Financial Institution
and Services
Litigation
Commercial Disputes
Consumer Financial
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Class Action
Litigation Defense
The First Circuit Clarifies That A Defendant’s
Deadline to Remove is Principally Influenced by the
Actions of the Plaintiff
By Robert W. Sparkes, III & Brian M. Forbes
Introduction
The first questions any defendant served with a complaint filed in state court should consider
are whether removal of the action to federal court is preferable and, assuming the action is
removable, when must a notice of removal be filed. The “when” question continues to be a
source of debate as federal courts across the country grapple with issues pertaining to (1)
the triggering of the removal clocks under federal law and (2) the duty of a defendant to
investigate the removability of an action. Joining other federal circuit courts of appeal to
have addressed these issues,1 on October 24, 2014, the First Circuit Court of Appeals
provided its answers in Romulus v. CVS Pharmacy, Inc.2 And, it may come as a surprise to
some, the answers are largely dependent on the actions taken by the plaintiff.
The Removal Deadlines
In general, 28 U.S.C. § 1446(b) sets forth two time periods from which a defendant may
remove an action to federal court, each of which is subject to a 30-day deadline from the
triggering event.3
First, a case can be removed if grounds exist in the original complaint to remove the matter
from state court to federal court. If the case is removable on the face of the initial complaint,
a defendant must file a notice of removal within 30 days of service of the complaint under
Section 1446(b)(1).4
Second, “if the case stated by the initial pleading is not removable,” Section 1446(b)(3)
permits a defendant to file a notice of removal “within 30 days after receipt . . . of a copy of
an amended pleading, motion, order or other paper from which it may first be ascertained
that the case is one which is or has become removable.”5
Section 1446(b), however, is silent regarding the specifics of how and when the 30-day
removal clocks are triggered, whether those clocks are triggered by a defendant’s discovery
of information in its internal records, whether a defendant has an independent duty to
investigate removability and to affirmatively provide facts outside of the plaintiff’s complaint
or other document in removing the matter, and what documents or materials constitute “other
paper” that may trigger the removal deadline of Section 1446(b)(3).
The First Circuit Clarifies That A Defendant’s Deadline to
Remove is Principally Influenced by the Actions of the Plaintiff
Background and the District Court’s Decision in Romulus
The Romulus decision arose from a complaint filed in Massachusetts Superior Court against
the defendant CVS Pharmacy, Inc.6 The defendant first filed a notice of removal within 30
days of service of the plaintiffs’ original complaint.7 The District Court, however, rejected the
defendant’s calculation of the amount-in-controversy for purposes of removal under the
Class Action Fairness Act (“CAFA”) and granted the plaintiffs’ motion to remand to state
court.8
After remand and preliminary discovery, counsel for the plaintiffs sent an e-mail to counsel
for the defendant setting forth the plaintiffs’ contention as to the number of alleged statutory
violations at issue for the putative class for a portion of the class period.9 The conclusions in
the plaintiffs’ e-mail were based entirely on information provided by the defendant in
discovery.10 On the basis of the plaintiffs’ e-mail, the defendant filed a second notice of
removal.11
The District Court again granted the plaintiffs’ motion to remand, finding that the defendant’s
second notice of removal was untimely and that the defendant failed to demonstrate that the
amount in controversy exceeded CAFA’s $5 million threshold.12 The District Court held that
more than 30 days had elapsed since the filing of the plaintiffs’ complaint and that the
plaintiffs’ e-mail did not constitute “other paper” under Section 1446(b)(3) because it did not
provide “new” information regarding removability that the defendant could not have
previously discovered, the defendant had possession of the underlying information from the
beginning of the litigation, and the defendant “violated a duty to make a reasonable inquiry
into its own records at the time of the [filing of the] complaint.”13
The First Circuit’s Decision on Appeal
In considering the Romulus appeal, the First Circuit reversed the District Court’s decision
and ordered that the “case is now in federal court to stay.”14 In doing so, the First Circuit
adopted a bright-line rule for litigants and district courts to follow in evaluating the timeliness
of removal.
First, the Romulus Court held that the 30-day removal clocks under Section 1446(b) are
triggered “only when the plaintiffs’ complaint or plaintiffs’ subsequent paper provides the
defendant with sufficient information to easily determine that the matter is removable.”15
Under this standard, the time for removal begins to run only when a plaintiff’s complaint or
other paper either “includes a clear statement of the damages sought” or “sets forth sufficient
facts from which the amount in controversy can easily be ascertained by the defendant by
simple calculation.”16 In adopting this bright-line rule, the First Circuit followed the lead of
other circuit courts of appeal, including the Second Circuit and the Seventh Circuit.17
Second, the Romulus Court made clear that in assessing removability, “[t]he defendant has
no duty . . . to investigate or to supply facts outside of those provided by the plaintiff.”18
Instead, the removability of any putative class or individual action is dependent solely upon
the pleadings and “other papers” filed or provided by the plaintiff.19 Accordingly, even where,
as in Romulus, the defendant has information in its possession to support removal at the
time the original complaint is served, the 30-day removal clocks are not triggered and do not
begin to run until removability can first be “easily ascertained” from pleadings or papers
provided by the plaintiff.20
2
The First Circuit Clarifies That A Defendant’s Deadline to
Remove is Principally Influenced by the Actions of the Plaintiff
Third, the Romulus Court clarified what documents may constitute “other paper” for purposes
of triggering the removal clock under Section 1446(b)(3).21 Adopting a broad definition of the
term, the Court found that correspondence from a plaintiff to a defendant concerning the
potential amount in controversy – here an e-mail communication between counsel – satisfied
the statutory definition of “other paper.”22 If such an e-mail communication or other
correspondence “is the first document in which the plaintiff puts the defendant on notice that
the criteria for removal are met,” it will trigger the 30-day removal clock under Section
1446(b)(3).23
Fourth, the Romulus Court rejected as irrelevant the fact that the information in the plaintiffs’
“other paper” that supported removal was provided to the plaintiffs by the defendant. That is
because “[t]he timeliness inquiry is limited to the information in the plaintiffs’ papers,
regardless of whether its original source is the defendant,” “[t]he defendant has no duty to
perform significant investigation of its own data to ascertain removability,” and “[t]he test is
not whether the information is ‘new,’ but when the plaintiffs’ papers ‘first’ enable the
defendant to make the requisite merits showing to the district court.”24
Conclusion
The First Circuit’s decision provides needed clarification governing the timeliness of removal
and a defendant’s role in assessing and investigating the removability of an action. And, just
as important, the Romulus Court’s bright-line rules and guidance should be viewed positively
by defendants seeking to remove in the First Circuit, especially in putative class actions
where initial complaints may lack specificity regarding the amount of damages or the value of
other relief sought by the proposed class. The Romulus decision further makes clear that,
even if the initial pleading does not provide a basis for removal on its face, opportunities may
arise later to remove the matter from state court to federal court based on the plaintiff’s
subsequent actions.
Authors:
Robert W. Sparkes, III
robert.sparkes@klgates.com
+1.617.951.9134
Brian M. Forbes
brian.forbes@klgates.com
+1.617.261.3152
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3
The First Circuit Clarifies That A Defendant’s Deadline to
Remove is Principally Influenced by the Actions of the Plaintiff
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1
See, e.g., Cutrone v. Mortgage Electronic Registration Sys., Inc., 749 F.3d 137 (2d Cir. 2014). For a discussion
of the decision of the United States Court of Appeals for the Second Circuit in Cutrone, see K&L Gates LLP June 2014
Alert, Winding the Removal Clock: The Second Circuit Clarifies the Deadline for Removal Under the Class Action Fairness
Act, by Robert W. Sparkes, III and Brian M. Forbes.
2
--- F.3d ---, 2014 WL 5422160 (1st Cir. Oct. 24, 2014).
3
Notably, the First Circuit did not address whether a defendant may remove based on its own investigation
before the 30-day removal time periods of Section 1446(b) have begun. See id. at *11 n.12. At least three other circuit
courts of appeal, namely, the Second, Seventh, and Ninth Circuits, have answered the question in the affirmative and
found that the 30-day periods are not the exclusive time periods in which a defendant may remove a case. Id. (“Three
circuits have agreed that a defendant can remove on the basis of its own investigation if neither of the statutory grants for
removal in Section 1446(b) have been triggered and transgressed.”).
4
28 U.S.C. § 1446(b)(1) (“[t]he notice of removal of a civil action . . . shall be filed within 30 days after the receipt
by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which
such action or proceeding is based”).
5
28 U.S.C. § 1446(b)(3).
6
Romulus, 2014 WL 5422160, at *1.
7
See id. at *2.
8
See id.
9
See id.
10
See id.
11
See id.
12
See id. at *3.
13
Id.
14
Id. at *13.
15
Id. at *4 (emphasis in original).
16
Id. at *7 (emphasis added).
17
See id. at *6-7; see also Cutrone, 749 F.3d at 143-45; Walker v. Trailer Transit, Inc., 727 F.3d 819, 824 (7th Cir.
2013).
18
Romulus, 2014 WL 5422160, at *7, *11. As noted above, the First Circuit did not decide the issue of whether a
defendant may remove based on information discovered in its own investigation where the 30-day removal time periods of
Section 1446(b) have not yet begun to run. See id. at *11 n.12.
19
See id. at *8 (“To determine whether the Section 1446(b) clocks have begun to run, . . . we focus exclusively on
the pleadings and other papers provided by the plaintiffs.”).
20
See id. at *6 (“Even if the case was previously removable, Section 1446(b)(3) does not apply until removability
can first be ascertained from the plaintiffs’ own papers.” (emphasis in original)); see also id. at *8 (finding that although
defendant had information in its possession to support removability at the time the original complaint was filed, the fact
that the complaint was missing essential facts necessary to “easily ascertain[ ]” the amount in controversy supported a
finding that the removal clock did not begin to run when the defendant was served with the original complaint).
21
Id. at *8-11 (“Given the ambiguity present in the text [of Section 1446(b)(3)], we rely on the clear congressional
intent to interpret ‘other paper’ broadly.”).
22
Id. at *10.
4
The First Circuit Clarifies That A Defendant’s Deadline to
Remove is Principally Influenced by the Actions of the Plaintiff
23
Id.
24
Id. at *11 (emphasis in original).
5